INDIANAPOLIS – As utility bills continue to increase, more Hoosiers are considering alternative sources of energy to keep their homes warm in the winter and cool in the summer.
“Energy prices are going nowhere but up,” said Kerwin Olson, with the Citizens Action Coalition. “There’s no end in sight.”
Since installing a home solar power system on her Indianapolis home in July, Courtney Conway says her family has seen their energy bills drastically reduced.
“In the summer months when we use more energy, it’ll cut our bills in half,” Conway said. “But in the winter months, we’re expecting it to completely replace our power bill, which is amazing.”
Conway says her family is saving enough on their energy bills to cover the monthly payments on their $19,000 home solar system, which they also consider an investment in the future.
“It was something that we could afford and it just feels like something that’s good to do,” she said.
Taking steps before deciding on solar
Savings like these are typical for home solar users, according to Olson. At the same time, he recommends anyone considering a home solar system takes several steps to make sure it’s the right decision.
“The first thing they should do before doing anything at all is a home energy audit,” Olson said. “Because you don’t want to put solar on an inefficient home.”
On average, he says most homes waste between 20% and 40% of the energy they consume. Most utility companies offer home energy audits at relatively low costs.
“Duke Energy I believe offers a whole home energy audit with the blower door test for about $50,” Olson said. “AES Indiana offers a free energy audits, depending on your income at the home.”
Other companies generally offer home energy audits for around $100 or $150, he said. Such audits can help determine where your home is losing energy. Any changes or upgrades to eliminate energy waste will cost more.
Next, before deciding to install solar panels, Olson recommends a roof check.
“Lots of roofs are old, cracked, have had issues,” he said. “Their foundation is not strong enough to hold solar. So do a roof check, make sure your roof is okay.”
He says most roof checks are generally provided as a free service by solar system installers. You can also reach out to organizations dedicated to helping homeowners go solar like Solarize Indiana, Solar United Neighbors or Siren.
Olson also recommends getting multiple quotes from solar system installers and being prepared to pay more on your homeowners insurance policy for insurance costs. However, he says, such insurance increases are usually minimal.
“Solar advocates have been successful in stopping exorbitant insurance requirements for solar,” he said. “But that is something that folks should definitely look into, whether or not their existing policies would cover them, or if there are additional adders they would need to add.”
Conway says her homeowners insurance was unaffected by their home solar system. In general, she has no regrets.
“All of the money that we’re saving from our are smaller power bill is going right back into paying off the actual system,” she said. “Feels worth it to me.”
Solar energy in Indiana
However, Matt Schloss can’t say the same.
“For the time being, I’d probably hold off if I was anyone else,” Schloss said.
For Schloss, an Evansville resident, part of the allure of going solar is that the system often produces more energy than a home uses. Utility companies then buy the surplus, often resulting in a credit on a homeowner’s energy bill. For years, home solar customers have banked on this exchange as a way to pay off their home solar systems.
“The payoff is about 10 years or less for some people,” Schloss said.
However, a recent change in state law, brought on by SEA 309, is changing the landscape for such energy exchanges, which used to be based on a one-to-one ratio called “net metering.”
“I thought it was going to be a one-to-one ratio,” Schloss said. “You know when I buy power, they’d pay me the same for what they buy back. But it does not work like that.”
Instead of a one-to-one swap for energy, Schloss says CenterPoint Energy is paying him roughly 40% for the excess energy he produces. And that is changing the outlook for how long it will take him to pay off his solar energy system.
“So from my initial thoughts of 10 years or less, probably double that,” Schloss said. “Pretty mad. I don’t know why they think their energy is better than mine.”
Olson and other solar advocates believe the changing buy-back rates will serve as a barrier to expanding home solar use in Indiana.
“Some of those payback periods are even extending beyond the design life of the system,” Olson said.
“20 years is not going to cut it for most people, I don’t think,” Schloss said.
However, utility companies and those who represent them argue the law change protects the vast majority of power customers who don’t use home solar systems.
“The original intent of the legislation was to ensure that customers who do not own solar generation are not subsidizing those who do,” Indiana Energy Association President Danielle McGrath said in a statement. “Even though they generate some of their own power, solar customers still rely on existing electric infrastructure such as power lines, and the new rate reflects the costs of that.”
“Under the new rate, customers who generate their own power still get the benefit of that energy for their own use and are paid a 25% premium for the excess power they generate,” McGrath went on to say. “Solar customers are still being paid more for the energy they are producing than the utility could buy it for at wholesale. Overall, the law strikes a balance to ensure that everyone who uses the electric grid continues to pay their fair share for it.”
The interpretation of of SEA309 is currently pending before the Indiana Supreme Court. Oral arguments were heard in mid-September and the parties involved are awaiting a ruling.